28 February 2022 Updates

⏺️ FINAL MEF Panel for 2021-22 HAS BEEN RELEASED

Kindly Check Your Firm RBI Category/UCN as below:-

Online MEF Link: 

https://app.meficai.org/panel

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CBIC has set up a ‘GST Refund Help Desk’ for addressing payment related problems faced by the taxpayers. Contact Ms Anita Rawat, Toll Free Number : 1800-11-1424 Mail ID : gstrefunds-helpdesk@gov.in 

Supply of food and beverages by the eating joints by way of Dine In, Take Away, Delivery, is classifiable under HSN code 9963 and will be treated as Supply of ‘Restaurant Service’ as per entry 6(b) of Sch.II, GST Act, 2017, liable to 5% GST (without ITC).

GSTN has enabled the feature to withdraw applications for cancellation of GST registration on the GST portal. If the application for cancellation of GST registration is made by mistake and the applicant wishes to withdraw. 

The Reserve Bank said the Regulations Review Authority has recommended withdrawing about 100 more redundant circulars, besides elimination of certain paper based returns, a move expected to ease compliance for regulated entities with an objective to reduce the compliance burden on regulated entities (REs).

The Supreme Court upheld  Rajasthan High Court judgment and held that RERA would not apply in relation to the transaction between the borrower and the banks and financial institutions in cases where security interest has been created by mortgaging the property. Union Bank of India Vs Rajasthan Real Estate Regulatory Authority. 

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⏺️The LUT for FY 2022-2023 can now be filed on the gst portal.

To whomever this is applicable, it must be filed before 31.03.2022

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Rajasthan High Court directs Income Tax  department to accept decelaration under Vivad se Vishwas Scheme, 2020. Case Name : Rakesh Garg Son of Shri Kailash Chand Garg Vs PCIT. Appeal Number : D.B. Civil Writ Petition No. 4178/2021 Date of Judgement/Order : 17/02/2022. 

Gujrat High Court allows Refund of IGST lying in Electronic Credit Ledger. Case Name : IPCA Laboratories Ltd. Vs Commissioner.  Appeal Number : Special Civil Application No. 638 of 2021 Date of Judgement/Order : 18/02/2022

Letter of Undertaking (LUT) for FY2022-23 is now live on the GST Portal. Facility for the same is available under the tab Services>User Services> Furnish Letter of Undertaking (LUT). the validity of LUT for FY 2021-22 will end on 31st March 2022. Further, two witnesses are needed for the filing the said application.

MCA initiates process of De-criminalisation of compoundable offences of LLP Further in continuation of the same Cabinet has passed LLP Amendment Bill, 2021. Finally, on 12th February, 2022 MCA has issued notification that provisions of Section 1 to 29 of LLP Amendment Act, 2021 shall came into effect from 1st April, 2022.

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MCA UPDATE

All the stakeholders are hereby informed that the Registrar of Companies and the Regional Directors of the Ministry of Corporate Affairs at all locations have been directed by the Ministry to enter all cases of complaints against the Companies and the LLPs, Inspections, Inquiries, Investigations and Prosecutions in the MCA Electronic registry i.e., MCA21 before issuing any letter, notice, order etc. Thereafter, a Service Request Number (SRN) is generated. They have also been directed to mention such SRN mandatorily in all such communications to Companies, LLPs, their officers, auditors, etc., on all communications. Therefore, all stakeholders are advised to treat any such communication received without SRN as unauthorised which need not be responded further. Any instance of such communication received without mentioning SRN may be brought to the notice of the Office of the Director General of Corporate Officer (DGCoA) at email dgcoa@mca.gov.in along with the copy of communication.

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Assorted freebies given by pharmaceutical companies to doctors to influence their prescription of medicines can’t be claimed by the firms as ‘business expenditure’ to reduce their tax outgo, the Supreme Court ruled. The court noted that acceptance of these freebies by doctors is punishable by the Medical Council of India. Apex Laboratories’s appeal against the Madras High Court’s judgement. 



CWIP write-offs of abandoned pre-operational projects. The assessee, Rediff.com in [2022] 441 ITR 195 (Bom) claimed deduction of CWIP write offs total of more than 8 crores pertaining to  abandoned projects in its existing business of website management and online services.

Allowing such deduction the Bombay High Court held that since it has not resulted in bringing any new asset into existence, then, such expenditure is an allowable business expenditure.

File Letter of Undertaking (LUT) for FY 2022-23 on GST Portal for Exports /Sales to SEZ etc without payment of GST. Existing LUT to expire on 31.3.2022. 

MCA has released a set of FAQs in relation with the LLP e-filing services on the portal. Recently, all the LLP e-filing services are being upgraded and migrated to the MCA V3 portal. However, all the other services will continue to exist at the MCA V2 portal.

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👉🏻RBI amends payments systems rules

(The Reserve Bank of India issued amended Payments and Settlement Systems Regulations that allows companies wanting to run payment businesses to seek licenses from the regulator)

👇🏻 👇🏻 👇🏻

https://bit.ly/3hbUNmP

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📌 *E-invoicing for taxpayers if Turnover crosses 20 Crores

📰 From 01st April 2022, e-invoicing will be mandatory for taxpayers whose aggregate turnover is more than Rs.20 crore Rupees.

Source: NN 01/2022 dated 24.02.2022

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The Supreme Court said an exception or exempting provision in a taxing statute should be construed strictly and it is not open to the court to ignore the conditions prescribed in the policy and notifications issued in that regard. The apex court said the exemption notification should be given meaning according to the legislative intendment and such statutory provisions have to be interpreted in light of the “words employed in them”. 

E invoice limit reduced From 50cr to 20 Cr vide Notification 01/2022-CT Dated 24th Feb, 2022 . The change will be effective from 01.04.2022 .

In the interest of Trade and Industry Representation made by ICAI seeking exemption from levy of late fee on GSTR 9 and 9C filed on or before March 31, 2022. 

The Central Board of Indirect Taxes & Customs had issued an update dated February 23, 2022, regarding upcoming GSTR-1 enhancements & improvements. Following changes are being done in GSTR-1/IFF:

Removal of ‘Submit’ button before filing : The present two-step filing of GSTR-1/IFF involving ‘Submit’ and ‘File’ buttons will be replaced with a simpler single-step filing process . The upcoming ‘File Statement’ button will replace the present two-step filing process and will provide taxpayers with the flexibility to add or modify records till the filing is completed by pressing the ‘File Statement’ button.

Recipient wise summary : The consolidated summary page will also provide a recipient-wise summary, containing the total value of the supplies & the total tax involved in such supplies for each recipient. The recipient-wise summary will be made available with respect to the following tables of GSTR-1/IFF, which have counter-party recipients. 

Russia's Moscow Exchange Thursday said it is suspending all trading in the wake of the launch of a full-scale invasion of Ukraine by Russia. The exchange will announce the resumption of trading at a later date, it said. The Saint Petersburg Stock Exchange also said it was stopping trading. 

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CBDT issues refunds of over Rs. 1,82,995 crore to more than 2.07 crore taxpayers from 1st Apr,2021 to 21st Feb,2022. This includes personal income tax refunds of Rs 65,498 crore to over 2.04 crore assessees and corporate tax refunds of Rs 1.17 lakh crore to 2.30 lakh entities.



Bombay High Court observes that a large number of writ petitions are filed on routine basis challenging reopening of assessments, “despite numerous judgments on this issue, the same errors are repeated by the Revenue authorities - Directs CBDT to issue guidelines for reducing repetition of errors in reassessment proceedings.

The Supreme Court has denied a tax deduction for incentives / freebies which are typically provided by pharmaceutical companies to doctors / medical practitioners.

Any default or delay in the payment of EPF contribution by the employer under the Act is a sine qua non for imposition of levy of damages under Section 14B. [Referred to Union of India v. Dharmendra Textiles Processors & others (2008) 306 ITR 277 : 219 CTR 617 : 174 Taxman 571 (SC)]

Indian stock exchanges are settled within two days, just like most major markets such as Singapore, Hong Kong, Australia, Japan, and South Korea. Indian exchanges, however, will be moving to T+1 settlement from February 25 in a phased manner. 

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👉 RBI Bulletin - February 2022

https://www.rbi.org.in/Scripts/BS_PressReleaseDisplay.aspx?prid=53283

👉 New Definition of Micro, Small and Medium Enterprises - Clarification

https://rbi.org.in/Scripts/NotificationUser.aspx?Id=12233&Mode=0

👉 Extension of the Last Date for submission of application for Empanelment of Chartered Accountants firms/LLPs with O/o C&AG for the year 2022-23 

https://www.icai.org/post/pdc-announcement-14022022

👉 Filling up the post of Registrar, National Company Law Tribunal, New Delhi on deputation basis 

https://www.mca.gov.in/bin/dms/getdocument?mds=HQELKUpPNwtoEl4X0yqWfg%253D%253D&type=open

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⏺️ Peer Review Mandate - Phase I

“Peer Review Mandate - Roll Out” dated 12.02.2022 hosted at https://www.icai.org/post/peer-review-mandate-roll-out , the firms falling under Phase I of the roll out will be required to submit a declaration form https://forms.office.com/r/AA5Zpgdsrr by March 31, 2022.

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Income Tax Section 68: Assessing Officer cannot inquire source of source. Case Name : DCIT Vs Aarti Catalyst Solutions P. Ltd. (ITAT Ahmedabad) Appeal Number : ITA No.1195/Ahd/2018 Date of Judgement/Order : 16/02/2022

Income from PF Contribution Above Rs 2.5 Lakhs Limit to be Taxable From April 1, 2022. As per new rules a threshold limit of Rs 2.5 lakh has been set on tax-free contributions for non-government employees and Rs 5 lakh for government employees.

GST From April 1, e-invoice mandatory for firms with turnover of RS. 20 Cr+. E-invoicing will be compulsory for all businesses with a turnover higher than RS. 20 crore from April 1, with the Central Board of Direct taxes and Customs lowering the turnover threshold for electronic billing from RS. 50 crore. 

From the next fiscal year, taxpayers must generate invoices on their internal systems or billing software and then report them online to the invoice registration portal. This is required to avail of input tax credit (ITC).

GSTN has informed that following Improvements are going to be enabled in the interface of GSTR-1 at GST Portal:

Submit button shall be removed, two-step filing  process (‘Submit’ and ‘File) shall be replaced by one-step filing process (only ‘File Statement’).

Now taxpayers can view a table-wise consolidated summary before filing of GSTR-1/IFF.

The consolidated summary page will provide a recipient-wise summary containing the value of supplies and tax. Recipient-wise summary will be available for Table-4A, 4B, 6B, 6C, 9B.

SEBI extended the deadline to May 1 for implementation of the swing pricing mechanism, for mutual fund schemes, aimed at discouraging large investors from sudden redemptions. The new framework, aimed at ensuring fairness in treatment of entering, exiting and existing investors in mutual fund schemes, particularly during market dislocation, was to be applicable from March 1.

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 GSTR-9 Annual Return for FY 20-21

 28th Feb, 2022 is the due date to file GSTR-9 for the FY 20-21

1️⃣ GSTR-9 Applicable if AATO > Rs. 2 Crores.

GSTR-9C Applicable if AATO > Rs. 5 Crores.

2️⃣ T4A to T4G - Mandatory - Supplies on which Tax Paid in FY 20-21 and Supplies on which Tax Payable. Supplies of FY 19-20 on which tax paid in FY 20-21 not to reported here.

3️⃣ T5A to T5C - Mandatory - Zero Rated Supply. 

4️⃣ T6A - Auto-populated from GSTR-3B of FY 20-21.

T6B to T6H - Mandatory - Details of inputs and input services can be reported on a consolidated basis under the head ‘Inputs’ - ITC availed in 3B of FY 20-21 (Books of FY 20-21).

5️⃣ T6M - ITC availed in 3B of FY 20-21 (Books of FY 19-20).

6️⃣ T7A to T7H - Accumulated amount of reversal from 7A to 7E can be filled in 7H.

7️⃣ T8A - Auto-populated from GSTR-2A of FY 20-21 (Eligible ITC).

T8B - Auto-populated from T6B to T6H.

T8C - ITC of FY 20-21 availed in FY 21-22 upto 20/10/21.

8️⃣ T9 - Tax Payable can amend for tax payment.

9️⃣ T10 & T11 - Supplies of FY 20-21 on which GST paid/Reversed in FY 21-22  upto 20/10/21.

1️⃣0️⃣ T12 & T13 - ITC of FY 20-21 availed/Reversed in FY 21-22  upto 20/10/21.

1️⃣1️⃣ T14 - The tax payable as a result of declarations made in T10 and T11.

1️⃣2️⃣ T15 to T18 - Refunds, Demand, HSN Codes Optional.

1️⃣3️⃣ T19 - Late Fees Shall be levied w.e.f. 01-03-2022 at Rs. 200/day.

1️⃣4️⃣ If GST is payable - Report in T4 and T9 (Outward), T7 (ITC Reversal) & DRC-03.

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19 February 2022 Updates

⏺️ ICAI Peer Review Mandate Roll Out

Firms Conducting Audits of Branches of Public Sector Banks Shall also be required to have Peer Review

_For full Details click here_

https://www.icai.org/post/peer-review-mandate-roll-out

⏺️ Last date for filing without additional fees

✅ Annual filing - Refer below

⏺️ Form for CSR Reporting Notified For the Companies by "Companies Accounts Amendment Rules 2022" - Amendment made to Companies (Accounts) Rules to introduce Form CSR-2 to be filed as annexure to Form AOC-4. 

For FY 2020-21 to be filed separately till 31.3.2022.

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​​ICAI elects New Torchbearers-CA. (Dr.) Debashis Mitra elected as President & CA. Aniket Sunil Talati as Vice-President, ICAI for the year 2022-23. 

ICAI Council at its 407th Meeting of the Council held from 7th– 9th January 2022 decided to mandate the Peer Review process for coverage of more firms under Peer Review process. The roll out shall be made in four stages wef 1.4.2022. Firms Conducting Audits of Branches of Public Sector Banks Shall also be required to have Peer Review. 

ICAI issued Guidance Note on Audit of Banks (2022 Edition) Statutory audit of banks involves a number of peculiarities due to some unique features of banks and banking operations e.g. huge volumes and complexity of transactions, wide geographical spread of banks’ network, large range of products and services offered, extensive use of technology, strict vigilance by the banking regulator etc.

Central government is all set to use blockchain technology to curb fake billing and GST claims. In the first phase, the technology will be used for warehousing and monitoring of goods movement. With the technology, the government is aiming to catch fake claims immediately, especially in cases that file a fake supply of goods on paper.

CSR/ MCA Every company covered under the provisions of section 135(1) shall furnish a report on CSR in e-Form CSR-2 to the ROC for the preceding FY (2020-2021) and onwards as an addendum to Form AOC-4 or AOC-4 XBRL or AOC-4 NBFC (Ind AS).

Provided that for preceding FY 2020-21, Form CSR-2 shall be filed separately on or before 31st March 2022, after filing form AOC-4 Or AOC-4 XBRL Or AOC-4 NBFC (Ind as), as the case may be.

Limited Liability Partnership (Amendment) Rules, 2022 has been notified. The same is effective from 01.04.2022. Drastic reduction in additional fees has been done along with procedure for Adjudication of penalties and appeals laid down.

⏺️ DUE DATE - FEB 15, 2022

#Due Dates for Tax Audit Report (3CA-3CD/3CB-3CD)

The due date for filing of Tax Audit Report for all categories of assessees whose account are required to be audited.

#12AA/10(23C) registered/approved Charitable Trust/Institutions need to file Audit Report in Form 10B/10BB. 

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⏺️ Relaxation on levy of additional fees : MCA has extended annual forms filing dates as per their notification appearing on www.mca.gov.in

AOC-4 : 15th March 2022

MGT-7/7A : 31st March 2022

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⏺️ Extension of the Last Date for Submission of Application for Empanelment of Chartered Accountants Firms/LLPs with O/o C&AG for the year 2022-23 

Online Submission Date: 22 Feb

Hard Copy Date. : 28 Feb

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Surcharge on sales tax and turnover tax paid to the State Government is not a fee or charge coming within the scope of Section 40(a)(iib)(A) or 40(a)(iib)(B), as such same is not an amount which can be disallowed under the said provision and disallowance made in this regard is rightly set aside by the High Court (Favour of Assessee) Kerala State Beverages Manufacturing & Marketing Corporation Ltd  Vs. ACIT, 3rd Jan. 2022 (Supreme Court).

GSTR-9/9C threshold limit notifications for FY 2020-21. For GSTR-9 - 2 Cr and for GSTR-9C - 5 Cr. Both the limits are based on Aggregate Turnover, hence to be checked on PAN basis and not GSTIN wise.

Final report is not a substantive evidence, just a collective opinion of investigating officer: Case Name : Rajesh Yadav Vs State of U.P. (Supreme Court of India) Appeal Number : Criminal Appeal Nos. 339-340 of 2014 Date of Judgement/Order : 04/02/2022

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👉🏻Chartered Accountant's Assets worth Rs. 56 Cr Attached in Syndicate Bank Fraud Case

(The attached properties are in the form of agricultural land, plots, shops, offices, flats, fixed deposits and bank accounts. These properties were attached under the Prevention of Money Laundering Act (PMLA), 2002)

👇🏻 👇🏻 👇🏻

https://bit.ly/3gKX9J1

👉🏻SEBI cancels registration of 4 stock brokers, 11 depository participants

(SEBI cancelled the registration of 11 depository participants, including Karvy Stock Broking Ltd. In a separate order, the market regulator has also cancelled the registration certificate of four other stock brokers)

👇🏻 👇🏻 👇🏻

https://bit.ly/3rQbB90

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Certain provisions of Companies Act, 2013 is now applicable on LLPs

MCA vide Notification No. G.S.R. 110(E) dated 11th February, 2022 has notified the following provisions of the Companies Act, 2013 is now applicable on LLPs:

1) Section 90(1) to (11): Declaration of SBO;

2) Section 164(1) & (2): Disqualifications for appointment as designated partner;

3) Section 165(1) & (3) to (6): Number of LLPs in which designated partner i.e. 20 LLPs;

4) Section 167(1) to (3): Vacation of office of designated partner;

5) Section 206(5): Inspection of books and papers of LLP by an inspector;

6) Section 207(3): Applicability of CPC in respect of inspection or inquiry by the Registrar/inspector;

7) Section 252: Appeal to NCLT for restoration of name of LLP;

8) Section 439: Offences to be non-congnizable.

Note: Section 67 of the LLP Act, 2008 empowers the Central Government to direct, by notification, that any of the provisions of the Companies Act shall apply to any LLP or shall apply with such exception, modification and adaptation, as may be specified in the notification.

Click here to view Notification: https://www.mca.gov.in/bin/dms/getdocument?mds=s3NAd1DMJP%252Bb4D3KxSkX1Q%253D%253D&type=open

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Pune ITAT holds that CBDT Circular No. 3 of 2022 dated 03.02.2022 specifying the need for a separate notification for importing the beneficial treatment from another DTAA cannot have a retrospective effect; Observes that once DTAA is notified all its integral parts, including Protocol, get automatically notified and there remains no need to again notify the individual limbs of the DTAA. 

Department of Trade and Taxes has issued an update dated February 1, 2022, regarding indicative guidelines for the issuance of show-cause notices (SCNs). It has been brought to the notice of the Competent Authority that in several instances non-speaking & vague Show Cause Notices (SCNS) are being issued in violation of provisions of the GST Act and Rules made thereunder. In view of the above, it is important that proper diligence is made before the issuance of SCN’S by the Proper Officers.

Government has put in place a detailed disclosure framework for CSR spending by companies, with experts saying the move will help enhance transparency but at the same time, is also likely to increase the compliance burden. Form CSR-2 (Report on Corporate Social Responsibility) has been notified by the corporate affairs ministry.

CGST Act of 2017 includes a specific provision for "Compliance Rating Score". The Kerala State GST department has released this first document with respect to the score-card provision, which has not been released by the central government until now.

Reserve Bank Deputy Governor said they are even worse than Ponzi schemes and threaten the financial sovereignty of a country. Observing that crypto-technology is underpinned by a philosophy to evade government controls, he said they have been specifically developed to bypass the regulated financial system.

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Steps to withdraw application for cancellation of GST Registration :

In case you've applied for your GST Registration cancellation but for any reason, you want to withdraw the said application, then you may follow the below steps:

1. Go to the Common Portal and post login navigate through Services --> User Services --> View My Submissions

2. Click on the "Withdraw" button available beside your Application for Cancellation of Registration

3. Click on Confirm and your application will be withdrawn.

Source: GST Common Portal

#gstindiacare #gstupdates #portalupdate #gst

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Interest on blocking of ITC if restrictions is beyond one year under Rule 86A

Delhi HC in case of Fides Distribution Pvt. Ltd

1️⃣ Rule 86A(3) - Conditions of use of amount available in credit ledger, restriction shall cease to have effect after the expiry of a period of one year from the date of imposing such restriction.

2️⃣ Since ITC under Rule 86A of the CGST Rules, 2017 could have been blocked only for a period of one year, petitioner asking for grant of interest for blocking of ITC for more than one year. In the present case the blocking has been done for two years.

3️⃣ Next Date of hearing on 14.09.2022.

Reference Case Laws on Rule 86A

Krishna Fashion, Hon'ble Delhi HC

Barmecha Texfab Pvt. Ltd., Hon'ble Gujarat HC

Ambika Creation, Hon'ble Gujarat HC

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No Power of Negative Block for Credit to be availed in future: Gujarat HC directs GST Dept. to Refund of Rs.20 Lakh to Assessee* [Read Order]

Read More: https://www.taxscan.in/no-power-of-negative-block-for-credit-to-be-availed-in-future-gujarat-hc-directs-gst-dept-to-refund-of-rs-20-lakh-to-assessee/155056/

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Infosys releases Steps to Troubleshoot Error When using DSC [Read Guidance]

Read More: https://www.taxscan.in/infosys-releases-steps-to-troubleshoot-error-when-using-dsc/155127/

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Finance minister asked capital Sebi to prepare for any possible market turbulence in the wake of tapering by the US Federal Reserve, and also undertake “next-generation reforms” to ensure greater ease of doing business.

RBI extended the deadline for non-banking financial companies (NBFCs) to comply with new asset classification norms issued on November 12.Non-bank lenders will now be allowed to move to the new rules for recognising bad loans by September 30, 2022, as against March 31, 2022. 

Final MEF PANEL for STATUTORY BANK BRANCH AUDIT for the Year 2021-22 is now released.

Check Your Firm’s RBI Category - Online MEF Link: https://app.meficai.org/panel

Extension of last date for CAG empanelment for 22-23 to 22.2.22. Hard copies by 28.2.22. Queries at sao2ca5@cag.gov.in pdc@icai.in. 

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Blocking under Rule 86

Bombay HC in the case of Dee Vee Projects Ltd_ The Appellant.

1️⃣ The impugned order of blocking of the ECL of the petitioner is quashed and set aside. 

2️⃣ The respondents are at liberty to consider invocation of power under rule 86-A of the CGST Rules, 2017, afresh in accordance with law.

3️⃣ The power under Rule 86A doesn't enable the authority to impose a blanket prohibition upon utilization of full credit available in the ECL.

Reference Case Laws on Rule 86A

Radha Krishan Industries Versus State of Himachal Pradesh

HEC India LLP Versus Commissioner of GST

_Maneka Gandhi Versus Union of India_

Swadeshi Cotton Mills Versus Union of India

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Guest Lecture in Educational Institutions Attracts 18% GST: AAR Karnataka

If you give guest lecture in any educational institution then there is important news for you. Now in the coming times, you will have to pay 18 percent Goods and Services Tax (GST) on the earnings earned by giving guest lectures as a guest. According to the news of PTI, the Karnataka Bench of the Advance Ruling Authority (AAR) has given this arrangement. The applicant Sairam Gopalkrishna had contacted AAR and asked whether the income from guest lectures comes in taxable service (GST on guest lecture).

It is not under exempted category of services

According to the news, while passing this order, the AAR said that such services come under other professional, technical and business services and are not under the exempted category of services. In such a situation, GST will have to be paid at the rate of 18 percent on such services. This order of AAR means that service professionals whose income is more than 20 lakh rupees will have to pay 18 percent GST on the earnings from guest lectures.

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Karnataka Govt. Blacklists 60 Chartered Accountants for committing Irregularities

Read More: https://www.taxscan.in/karnataka-govt-blacklists-60-chartered-accountants-for-committing-irregularities/155253/

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👉 Setup of ‘GST Refund Help Desk’ in the office of Pr. CCA, CBIC

https://www.gst.gov.in/newsandupdates/read/523

👉 LLP (Amendment) Rules 2022 

https://www.mca.gov.in/bin/dms/getdocument?mds=5kJvpQFp31MPOQ2XlwM5Ug%253D%253D&type=open

👉 Publication: Handbook on Liquidation Process and Voluntary Liquidation Process under The Insolvency and Bankruptcy Code, 2016 by CIBC of ICAI 

https://resource.cdn.icai.org/69207cibc100222.pdf

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 Delhi High Court in case of Coforge Limited (formerly known as NIIT Technologies Ltd) vs. ACIT: ITA Nos.213- 214/2020 decided while reversing the decision of the Tribunal, held that demerger expenses under section 35DD of the Income Tax Act, 1961 (Ac”) are also allowable to the resulting company. 



The GST regime could get the most comprehensive makeover since it was introduced in 2017. The revision may simplify the rate structure and seek to lift revenue for states. The GST compensation given to states will end in June. The restructuring, which will be implemented in phases, may cut down tax exemptions, introduce only three major tax slabs and remove anomalies from taxing raw materials and intermediates. 

28.2.22 is the last date to file Annual Return (GSTR-9) for turnover above 2 cr & self certified Audit Report (GSTR-9C) for turnover above 5 cr for FY 2020-21.

Centre will take a proposal to the GST Council to levy GST on entities that provide a mining platform for cryptocurrency assets and those who use virtual digital assets as a medium of exchange in purchases. CBIC Chairman told Business Standard the proposal could be to tax these at the top bracket of 18 per cent.

ICAI will explore the use of blockchain technology in auditing, Technology will be a major focus of the Institute of Chartered Accountants of India (ICAI) as it not only disrupts but will also create opportunities. Artificial intelligence and blockchain technology will be the focus among the emerging technologies.

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Correction in GSTR-1: Relief to Appeallant

Bombay HC in the case of Mahle Anand Termal Systems Pvt. Ltd.

1️⃣ The Petitioner seeks an order and direction against the respondent to allow the petitioner to correct form GSTR-1 Return and Invoice by mentioning the correct GST No. Of their customers and other relief.

2️⃣ Inadvertently error occured in SAP wherein GSTIN remain to be corrected/updated.

3️⃣ The Hon'ble HC directed to consider the applicability of the circular 26/26/2017 and reference to below judgements.

Reference Case Laws cited

Madras HC in case of Pentacle Plant and Machineries Pvt. Ltd.

Madras HC in the case of Sun Dye Chem Vs. Assistant Commissioner

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13 February 2022 Updates

Important Due Dates of the Month

⏺️07.02.2022 Challan No. ITNS- 281 January 2022 Payment of TDS/TCS deducted /collected in January 2022.

⏺️15.02.2022 Filing of Audit Report under section 44AB AY 2021-22 The due date for filing an audit report under section 44AB for the assessment year 2021-22 in the case of a corporate or non-corporate assessee

⏺️15.02.2022 PF/ESI January 2022 Due Date for the payment of PF & ESI contribution

⏺️11.02.2022 GSTR 1 January 2022 Taxpayers have an aggregate turnover of more than Rs. 5 Crores or opted to file Monthly Return

⏺️13.02.2022 GSTR 1 (IFF) January 2022 GST return for the taxpayers who opted for QRMP scheme (Optional)

⏺️20.02.2022 GSTR 3B January 2022 The due date for GSTR-3B having an Annual Turnover of more than 5 Crores

⏺️28.02.2022 GSTR 9C FY 2020-21 Statement of Reconciliation under GST

⏺️15.02.2022 Form AOC 4 (CFS, XBRL, Non-XBRL) FY 2020-21 Form AOC 4 filing by Companies

⏺️28.02.2022 Form MGT 7/ 7A FY 2020-21 Form MGT 7A filing by Companies and One Person Company

⏺️The due date for filing the Return of Income for the Assessment Year 2021-22, which was originally 31st October 2021 under sub-section (1) of section 139 of the Act, now has been extended till 15.03.2022.

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CBDT issues Clarification regarding the Most-Favoured-Nation (MFN) clause in the Protocol to Indias DTAAs with certain countries. 

GST module wise functionalities deployed on the GST Portal and webinars conducted/ Videos posted on our YouTube channel. 

Supreme Court Grants Bail To Man Accused Of Evading GST To Extent Of ₹64 Crore. Paresh Nathalal Chauhan v. The State Of Gujarat & Anr.| Petition(s) for Special Leave to Appeal for Cannot Be Detained In Custody Indefinitely. 

Reserve Bank will leave rates unchanged next week. Striking a different note from its peers, US brokerage Bank of America Securities has maintained that the  recognising growth-focused and capex-driven fiscal expansion, which though poses huge price pressure and interest rate risks later. 

Every offence punishable under N.I. Act. is compoundable: Case Name : Maheshsinh Babusinh Zala Vs State of Gujarat (Gujarat High Court) Appeal Number : R/Criminal Misc. Application No. 1046 of 2022 Date of Judgement/Order : 31/01/2022

FY23 Budget has proposed to introduce section 135AA in the customs act through the Finance Bill for “protection of data”. “If a person publishes any information relating to the value or classification or quantity of goods entered for export from India, or import into India, or the details of the exporter or importer of such goods under this Act, unless required so to do under any law for the time being in force, he shall be punishable with imprisonment for a term which may extend to six months, or with fine which may extend to fifty thousand rupees, or with both. 

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👉🏻CBIC  to  scale  up departmental audits to boost GST  compliance

CBIC is set to scale up scrutiny and departmental audits of risky taxpayers to improve GST collections while using data and technology to ensure that officials make decisions transparently)

👇🏻 👇🏻 👇🏻

https://bit.ly/3LhSjkE

👉🏻Around 6.17 Cr ITRs, 19 lakh TARs filed on the new e-Filing portal of IT Department

(Out of 6.17 Cr ITRs filed for AY 2021-22, 48% of these are ITR-1, 9% is ITR-2, 13% is ITR-3, 27% is ITR-4, ITR-5, ITR-6, and ITR-7. Over 1.73 lakh Form 3CA-3CD and 15.62 lakh Form 3CB-3CD have been filed in FY 2021-22)

👇🏻 👇🏻 👇🏻

https://bit.ly/3rxbX4a

👉🏻Updated Income Tax Return u/s 139(8A) And Tax on Updated Return u/s 140B

(Updated Income Tax Return u/s 139(8A) And Tax on Updated Return u/s 140B discussed by CA. Vivek Khurana)

👇🏻 👇🏻 👇🏻

https://youtu.be/HcgKnvgnPMA

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UAE announces introduction of corporate tax w.e.f. 1 June 2023: Top 10 Facts. With OECD adopting a minimum tax rate of 15%, UAE seems to have introduced Income Tax at an appropriate time, albeit at a lower rate.

Income Tax Addition is unsustainable if no incriminating material found during search. Case Name : DCIT Vs Mapsa Tapes Pvt. Ltd. (ITAT Delhi) Appeal Number : ITA. No. 3539/Del/2017. 

Centre will move the issue of bringing aviation turbine fuel (ATF) under the GST net for discussion in the next meeting of the GST Council, Finance Minister said, while noting that rising global fuel prices are a “concern”.

Guwahati High Court denies pre-arrest bail to person accused of carrying coals without GST. Case Name : Faruk Alam Vs State of Assam (Guwahati High Court)

MCA is preparing to launch the third version of the MCA21 portal in March, starting with the LLP module. The third version of the portal, a key platform to submit the required documents and filings under the companies law and the Limited Liability Partnership Act, will leverage analytics, artificial intelligence and machine learning.

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⏺️Union Budget 2022: GST Input Tax Credit of any invoice or debit note of a financial year can now be claimed u/s 16(4) upto 30th Nov of the next financial year.

⏺️ Code of Ethics vis a vis statutory audit of Listed entities - It may be noted that pursuant to SEBI Notification No. LAD-NRO/GN/2009- 10/23/186926 dated 11th December, 2009, Statutory Audit of Listed Companies under the Companies Act, 2013 shall be done by only those auditors who have subjected themselves to the Peer Review process of the Institute, and hold a valid certificate issued by the Peer Review Board of the ICAI at the date of signing the financial statements of listed companies.

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👉🏻SEBI directs AMCs to form an audit committee from August

(SEBI  asked asset management companies (AMCs) to form audit committees which will be responsible for oversight of the financial reporting process, audit process and compliance with laws and regulations, among others)

👇🏻 👇🏻 👇🏻

https://bit.ly/3JissY4

👉🏻Section 194R - TDS on Benefit or Perquisite in respect of Business or Profession

(Section 194R - TDS on Benefit or Perquisite in respect of Business or Profession discussed by CA. Vivek Khurana)

👇🏻 👇🏻 👇🏻

https://youtu.be/_gCL8nxvbWo

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 ITATDelhi order dated 21/01/2022 where delayed deposit of Employeescontribution to PFand ESI was allowed. Presently in the Intimation received from CPC,Bangalore ,delayed deposit of PF and ESI was disallowed. However,the Tribunal is allowing the appeal in favour of the Assessee, on the groundthat 'Amendment by Finance Act,2021 'isapplicable Prospectively w.e.f 1st April,2021. (F.Y.2020-21).

Governmentexploring ways to levy GST on mining of cryptocurrenciesThe keyissue here is whether to treat the mining as goods or service. According toSubhash Chandra Garg Committee that proposed specific actions to be taken inrelation to virtual currencies (2019), “‘Mining’ means an activity aimed atcreating a cryptocurrency and/or validating a transaction of cryptocurrencybetween the buyer and seller of cryptocurrency.

Electronic Credit Ledger cannotremain blocked after expiry of period of 1 year. Case Name : K.Vinodhkumar VsCommissioner of GST and Central Excise (Madras High Court).

GST Council made rules further to amend the Jammu andKashmir Goods and Services Tax Rules, 2017,” read a notification issued by the Finance Department. As per notification, these amended rules will comeinto force on the date of publication of corresponding notification underCentral Goods and Services Tax Rules, 2017 in the Central Gazette.  

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⏺️ MCA UPDATE

The filing of AOC -4, AOC-4 (CFS), AOC- 4 XBRL, AOC – 4 Non-XBRL up to 15.02. 2022 Without additional fee, if not filed till 15.02.2022. Late fee will be calculated from the date originally date on which forms were required to file. Late fee Rs. 100 per day.

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⏺️ CAG Empanelment - 2022-23

The CAG Empanelment process for 2022-23 has started. Last Date for online submission is 15th February, 2022

👉 The firms/LLPs will be required to submit a print out of the acknowledgement letter generated online and also hard copies of the documents in support of their online application to the CAG Office by 28th February, 2022

Visit http://care.cag.gov.in/Authorised/Default.aspx

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CBDT Chairman said the taxpayer would be permitted to file only one updated return for an assessment year. The intent of this provision is to help people who have genuinely missed out on filing his/her returns. To correct any discrepancy or omissions, the Budget 2022-23 has permitted taxpayers to update their ITRs within two years of filing, subject to payment of taxes.

Trust entitled for benefit of excess utilization of earlier years Editor6 | Income Tax - Case Name : Hapur Pilkhuwa Development Authority Vs ACIT (ITAT Delhi) Appeal Number : ITA No. 4125/Del/2017 Date of Judgement/Order : 04/02/2022

Validity of addition u/s 68 when assessee has proved genuineness of transaction and AO possesses no adverse material against assessee. ITO Vs Cozy Footwear Pvt LtdITA No. 4284/Del/2017. 

Revenue Secretary said  Currently, a 5 per cent GST tax is levied on restaurant services, irrespective of whether it is air-conditioned or non-AC, without the benefit of the input tax credit (ITC). Also, restaurants in starred-hotels that charge Rs 7,500 or more per day room tariff will be levied 18 per cent GST but ITC is allowed for them. Those restaurants in hotels charging less than Rs 7,500 room tariff will charge five per cent GST but will not get ITC.

SEBI asked asset management companies (AMCs) to form audit committees which will be responsible for oversight of financial reporting process, audit process and compliance with laws and regulations, among others. The circular will come into force with effect from August 1, 2022.

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CBDT, in its letter dated 11.02.2022 to all PCCITs, PDGITs, CCITs & DGITs states that GAAR Secretariat has been set up in Delhi and all the references under section 144BA need to be sent directly to the GAAR Secretariat; The letter is in continuation of letter dated 07.04.2021, and states that by Department of Revenue’s Office Order dated 24.01.2022 an approving panel for GAAR references under section 144BA has been constituted.

​​Income Tax Dept. issue latest update for New E-filing Portal Income-tax Return. Around 6.2 crore ITRs & about 21 lakh major TARs filed on the new e-filing portal of ITD till 10th Feb, 2022. 2 new email ids- TAR.helpdesk@incometax.gov.in & ITR.helpdesk@incometax.gov.in have also been provided to assist filers for resolution of grievances related to e-filing.

No capital gains arises in the year in which an agreement to sell is entered into with buyer without possession being given to buyer, as there is no​​ "transfer" within the meaning of section 2(47) as decided in the case of Godha Realtors (P.) Ltd. V/s ACIT by Hon’ble Bangalore Tribunal

Circular No. 4 of 2021-22 regarding date of filing of DVAT Returns for the quarter ending 31.12.2021 has been extended upto 28.02.2022.

MCA has issued Companies (Accounts) Amendment Rules, 2022. They shall come into force on the date of their publication in the Official Gazette. New e-Form CSR-2 introduced. ​​

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🌺 New/Updated Peer Review Mandate

Firms Conducting Audits of Branches of Public Sector Banks Shall also be required to have Peer Review

👉 For full Details

https://www.icai.org/post/peer-review-mandate-roll-out

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👉🏻Over 6.2 cr ITRs, 21 lakh audit reports filed on new e-filing portal

(More than 6.2 Cr Income Tax Returns and about 21 lakh major Tax Audit Reports have been filed on the new e-Filing portal of the Income Tax as on 10th February 2022)

👇🏻 👇🏻 👇🏻

https://bit.ly/3sDuiMr

👉🏻Amendment of Section 194-IA - TDS on transfer of Certain Immovable Property

(Amendment of Section 194-IA - TDS on transfer of certain Immovable Property other than agricultural land discussed by CA. Vivek Khurana)

👇🏻 👇🏻 👇🏻

https://youtu.be/jN9R7iTCTq0  

👉🏻Webinar on Registered Valuers - New Opportunities and Scope for Professionals

(On Sunday, 13th February, 2022 from 11:30 AM to 12:30 PM. No Fees)

👇🏻 👇🏻 👇🏻

https://youtu.be/qfy1h-TdUxI

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🌺 MCA mandates new filing in the form of report on corporate social responsibility

MCA has amended the Companies (Accounts) Rules, 2014 w.e.f. 11th February, 2022 to provide that every company covered under the provisions of CSR shall furnish a report on Corporate Social Responsibility in

Form CSR-2 to the Registrar for the preceding *financial year (2020-2021) and onwards as an addendum to Form AOC-4 or AOC-4 XBRL or AOC-4 NBFC (Ind AS), as the case may be.

 However, for the preceding financial year (2020-2021), Form CSR-2 shall be filed separately on or before 31st March 2022, after filing Form AOC-4 or AOC-4 XBRL or AOC-4 NBFC (Ind AS), as the case may be.

👉 Click here to view Rules: https://www.mca.gov.in/bin/dms/getdocument?mds=adQPpN3U8Y7Llcmy0C8FvA%253D%253D&type=open

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📲 Download my official Android app "Updates by CARJ" 📚 to stay connected with latest news and updates 📝

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Thanks for reading

7 February 2022 Updates

🌺 Budget updates - Direct Tax

🫐 - Provision for filing ‘Updated Income Tax returns’ within 2 years from end of relevant AY

🫐- Reduced AMT rates for Co-operatives from 18.5% to 15%

🫐- Reduced surcharge for Co-operatives with total income of 1cr to 10Cr

🫐- Tax relief for persons with disability: Allow annuity payment to differently abled dependents when parents attaining age of 60 years

🍒- Deduction for National Pension Scheme for State Government employees u.s 80CCC made at par with Central Govt.

🍒- Start-ups established before 31.03.2023 (earlier – 31.03.2022; now extended by 1 year) will be provided tax breaks

🍒- Last date for commencement of manufacturing for claiming lower tax regime under Section 115BAB to be 31.03.2024 (earlier 31.03.2023; now extended by 1 year)

🍍 - Virtual digital assets (Cryptocurrency):

Income from transfer of virtual digital assets to be taxed at 30%; No deduction for expenses other than cost of acquisition; No set off of losses

🍍 TDS @ 1% on consideration above specific threshold

🍎 Gift to be taxed u.s 56(2)(x)

🍎- No repetitive appeals for common question of laws

🍎- Off-shore banking units/ IFSC income to be provided exemptions

🍋- Surcharge of certain AOPs to be capped at 15%

🍋- Surcharge on Long Term Capital Gains on any assets to be capped at 15%

🍋- Health and education cess not allowable as business expenditure u/s 37

🍊 No set off of losses against undisclosed income detected during search

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CBDT has extended the last date for updating UDINs for all the IT forms at the e-filing portal to 30th April, 2022. 

Income Tax Deptt calls on foreign bank account holders; notices, summons issued in past 10 days to marked persons who once spotted with secret foreign bank accounts are in for the long haul, with the past returning to haunt them just when they believed their run-ins with the taxman were over for good. 

Income Tax Search and Seizure: Declaration of undisclosed income to “buy peace” does not renders an assessee immunity from initiation and levy of penalty. 

Expenditure on foreign education of director's son- Since there is nexus between the expenses incurred on the higher education of the son of the director of the assessee company and the business of the company as he has later joined the services of the assessee-company and is discharging the duties as CEO. The expenditure incurred is to be allowed as deduction.     (Favour of Assessee) Lumino Indusries Ltd. & ORS. Vs. ACIT, 17thNov. 2021  ( ITAT-Kolkata)

National Company Law Appellate Tribunal (NCLAT) has set aside an earlier order of the Mumbai bench of the NCLT, which had directed the administrator of the debt-ridden DHFL to put the second settlement proposal by erstwhile promoter Kapil Wadhwan before its lenders for consideration.

FRN will be Compulsory Field for UDIN Generation from 1st February 2022. This will enable Firms to Know the UDIN Generated by the Partners on Behalf of Firm. 

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✍️  Key Highlights : Budget 2022

📍 GDP growth for FY 22 expected to be 9.2%, the highest for any large economy.

📍 PLI (Production Linked Incentive scheme) in 14 sectors for Aatmanirbhar Bharat to create 6 million jobs , additional allocation of Rs 19,500 crore for PLI in solar PV module manufacturing.

📍Promoting Fintech and digital economy a focus area for this Budget.

📍 75 digital banking systems in 75 districts by scheduled commercial banks.

📍 IBC to be amended to improve efficiency of resolution process including cross border.

📍 Core Banking Services to start in Post offices

📍 PM Gati-shakti masterplan Has scope to enhance Multimodal communication through 7 engines, 2000 km of rail network to be brought under KAVACH & Highway network to grow by 25,000 km in FY23.

📍Contracts for implementation of multimodal logistics parks at 4 locations to be awarded in 2022-23, in PPP Mode

📍 ECLGS (Emergency Credit Line Guarantee Scheme) to be extended upto March 2023, guaranteed cover extended by another Rs 50,000 crore

📍 8 million new dwelling in rural, urban areas to be completed under PM Awas yojana

📍 Rs 2.37 trillion worth of MSP direct payments to wheat and paddy farmers.

📍 Rs 2 trillion outlay for MSMEs, Additional loans for 13 mn MSMEs.

📍 Rs 48,000 crore allocated to housing projects under PM Housing Scheme for FY23, Rs 1,500 crore allocated for development of the Northeast in FY23 & Desh stack e-portal to be launched to promote Digital infra

📍 New provision to file updated return within 2 years of relevant assessment year.

📍 Alternate minimum tax for cooperative societies down from 18.5% to 15%

📍 Tax deduction limis for state govt employees to NPS raised from 10% to 14%

📍 Surcharge on Corporate tax pruned from 12% to 7% Surcharge on transfer of long-term capital gains tax capped at 15%

📍 Tax exemption to start-ups extended to March 2023.

📍 Gross GST collection for January 2022 at a record Rs 1.41 trillion

📍 No change  in income tax slab.

📍 Electric Vehicles battery-swapping policy to be brought out with interoperability standards.

📍Concessional duty on import of capital goods to be phased out.

📍 Duty on unpolished diamonds to be reduced to 5%

📍Customs duty on steel scrap extended by a year

📍RBI led digital rupee using blockchain to be launched in FY23, 1% TDS on transfer of virtual digital assets & income to be taxed at 30%

📍 68% of capital outlay for Domestic defence industry.

📍Revised Fiscal Deficit 6.9% of GDP in FY22 as against 6.8% in Budget estimates, Fiscal deficit at 6.4% in FY23

📍 Total expenditure in FY23 estimated at Rs 39.45 trillion ; total resources mobilisation to be Rs 22.84 trillion other than borrowing.

🌺 Budget - 2022

🍎 1. Budget 2022 to focus on 4 pillars - productivity, climate action, financing investments & PM Gati Shakti plan. FY22 Economic growth pegged at 9.2 percent. 

🍊 2. Promoting Digital Eco & Fintech amongst focused areas of Government.

🍋 3. Expansion of highways by 25,000 kms & 'Gati Shakti' Master Plan among top priorities. To raise 20,000 cr thru innovative financing. PM Gati Shakti is a transformative approach, driven by roads, railways, ports, airports, mass transport, waterways and logistics infrastructure. All seven engines will pull the economy forward in unison, says FM. 

🍒 4. Contracts for 4 multimodal logistics parks in PPP mode will be awarded in 2022-23. To boost cargo logistics, multimodal connectivity

🫐 5. 400 new `Vande Bharat trains to be launched.

🍍 6. Hospitality & related services esp micro & small units are yet to reach the pre-pandemic level of biz. Hence #ECLGS will be extended upto March 2023 & its guarantee cover will be expanded by Rs.50K crore to a total cover of Rs.5 lakh crore

🎂 7. FM says that India to promote startups for Drone Making. Good For Zen Technologies

🍉 8. National tele mental health program to be launched with network of 23 tele mental health centres of excellence with NIMHANS being nodal centre and IIIT Bangalore providing tech support

🍇 9. 5G spectrum auctions to be carried out in calendar 2022 to enable launch of services within FY22-23. Scheme for design led manufacturing will be launched for 5G as part of PLI. To boost rural broadband. All villages should have same access to eServices and digital resources as urban areas

🍓 10. Will set up digital university for providing access to schools

🥥 11. The implementation of Rs 44,605-crore Ken-Betwa link project will be taken up with an aim of provide irrigation benefits to 9 lakh hectare of agriculture lands

🫑 12. To award 8 ropeway projects in FY23

🥑 13. A fund with blended capital raised under the co-investment model will be facilitated via #NABARD to finance startups for agri & rural enterprises relevant for farm produce value chains. 

🌶️ 14. To spend 64,000 cr on providing drinking water on tap. Nal sey Jal yojana

🥕 15. ePassports will be rolled out in 2022-23 for convenience in overseas travel

🍏 16. Battery swapping policy will be brought out. The best thing for EVs

🌽 17. Scope of single-window portal for all green clearances will be expanded

🧅 18. 1.5 lakh post offices to be connected to core banking. Net Banking, mobile banking, ATMs to connect Post office accounts and bank accounts. Will help farmers and senior citizens and enable inclusion

🍟 19. 80 lakh houses will be completed for identified beneficiaries of PM Awas Yojana

🍫 20. With 1486 union laws repealed, Ease of Doing Business 2.0 will be launched

🥜 21. 75 digital banking units in 75 districts

🍰  22. An open platform for National Digital Health Ecosystem will be rolled out

🧊 23. Necessary amendments in IBC to be made for more efficient resolution; to also enable cross border insolvency resolution 

🍎 24. Special economic zone policy to be replaced with a new legislation. States will be made partners. Looking to take the States along

🍊 25. Solar power - addl Rs 19,500 crore PLI for making high-efficiency modules to facilitate 280 GW installed capacity by 2030. 

🍉 26. To reduce indirect cost for suppliers and work contractors the use of surety bonds as a substitute for bank guarantee will be made acceptable in government procurements. IRDAI has given the framework for issue of surety bonds by insurance companies.

🍒 27. Task force for the promotion of AVGC will be set up; to employ youth in the visuals & animation sector

🍍 28. UDYAM, e-SHRAM, National Career Service (NCS), ASEEM portals to be interlinked, scope widened.

🫐 29. Financial support will be provided to farmers wanting to take up Agro-Forestry

🍇 30. Sovereign green bonds to be issued; proceeds will be deployed in public sector projects.

🍟 31. Govt committed to reducing imports and promoting atmanirbharta in equipment of the armed forces. 68% of capital procurement budget will be for earmarked for domestic industry, up from 58% in 2021-22. Defence R&D to be opened up to pvt industry.

🥕 32. Outlay for capital expenditure stepped up by 35.4% to Rs 7.50 lk cr in FY23 from Rs 5.54 lk cr in Fy22; 2.9% of GDP . Public expenditure needed to pump prime demand and crowd in private investment.

🍫 33. RBI to introduce Digital Rupee using blockchain and other technology. Introduction of digital rupee to be issued by RBI starting FY23 

🫑 34. To setup an expert committee to examine holistic regulatory framework for VCs, PEs and look at areas of friction 

🫐 35. Provisions have been made for payment of 75% of running bills mandatorily within 10 days and for encouraging settlement of disputes through conciliation. To increase transparency and to reduce payment delays, a completely paperless end-to-end online e-bill system will be launched for use by all Central ministries for their procurements

🍎 36. Reduced MAT for cooperatives. Rate to be reduced to 15% in order to be on the same level as companies

🍉 37. Income Tax payers will now be allowed to file an updated return within two years from the end of relevant assessment year.

🍏 38. Tax Deduction limit for state govt employees to NPS raised to 14% from 10%

🧅 39. 30% Taxation on virtual digital assets. No deduction. No loss can be offset against any other income. Crypto, Bitcoin. Gift of virtual digital asset will be taxed at the hand of the recipient. 1% TDS on payments made on transfer of digital assets. 

🍋 40. Incentives for startups: period of incorporation extended by a year to 2023 to avail of tax benefits. For corporates, Extension also granted for new companies to setup manufacturing facilities to 2024 from earlier 2023 

🍊 41. Surcharge on LTCG capped at 15%.

🍓 42. Propose to cap surcharge for AOPs at 15%.

🌶️ 43. No more changes in Direct Taxes. Slabs remain same

🌽 44. Customs duty on import of imitation jewellery. Customs duty on diamond and precious stones reduced to 5% . Big Rationalisation of custom rates continues. More than 350 exemption entries are being phased out. Includes certain agri produces, chemicals, med devices, drugs etc. Customs duty on Steel Scrap extended by one year. Duty on umbrellas raised to 20%. Nothing on Tobacco. Keep a watch on ITC

🥜 45. PwD individuals would be able to get annuity and lumpsum amount payment during the lifetime of the parent/guardian upon attaining the age of 16 years

🥕 46. Draft Detailed Project Report for 5 river links have been finalised', says FM

🍓 47. National tele-medicine programme to be launched.

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The MCA issued an Update dated February 01, 2022 w.r.t. launching a new way of e-filing for Limited Liability Partnership (“LLP”) on MCA21 portal.

In our continuous endeavor to serve you better, the Ministry of Corporate Affairs is launching a new way of e-filing for LLP on MCA21 portal. All LLP filings going forward will be web based. This application is proposed to be launched on March 06, 2022 at 12:00 AM. To facilitate this implementation stakeholders are advised to plan as per the following:

a. LLP e-Filings on MCA21 portal will be disabled from February 25, 2022 12:00 AM. All stakeholders are advised to ensure that there are no SRNs in pending payment status.

b. Offline payments for LLP using Bank Challan and Pay later option would be stopped from February 19, 2022 12:00 AM. Please note that during February 19, 2022 12:00 AM to February 25, 2022 12:00 AM, payments for LLP will be accepted only through online mode (Credit/Debit Card and Net Banking).

c. DSC association and new user registration on MCA21 portal will be stopped on February 25, 2022 12:00 AM. These services will resume in new application with LLP launch.

d. Please note that there will not any interruption in filling of Company forms.

Source from: https://www.mca.gov.in/content/mca/global/en/notifications-tender/news-updates/updates.html

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🌺 LLP Update

The Ministry of Corporate Affairs is Launching a New Way of Web Based  e-filing for LLP on MCA21 Portal from6th Mar 2022 at 12:00 AM

🌽 To Facilitate this Implementation Stakeholders are Advised to Plan as per the following: 

🍎 a. LLP e-Filings on MCA21 Portal will be Disabled from 25th Feb 2022 12:00 AM.

💎 b. All stakeholders are advised to ensure that there are no SRNs in pending payment status.

🧭 c. Offline payments for LLP using Bank Challan and Pay later option would be stopped from 19th Feb 2022 12:00 AM.

🔮 d. Please note that during 19th Feb 2022 12:00 AM to 25th Feb 2022 12:00 AM, payments for LLP will be accepted only through online mode (Credit/Debit Card and Net Banking).

🫐 e. DSC association and new user registration on MCA21 portal will be stopped on 25th Feb 2022 12:00 AM

🍊 f. These services will resume in new application with LLP launch. 

🍋 g. Please note that there will not any interruption in filling of Company

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👉🏻SEBI lays guidelines for MFs with respect to Ind AS

(Sebi has amended mutual fund rules which mandated AMCs to prepare the financial statements and accounts of the mutual fund schemes in accordance with Ind AS)

👇🏻 👇🏻 👇🏻

https://bit.ly/3Gt61gW

👉🏻TDS Rates applicable for Financial Year 2022-23 / Assessment Year 2023-24 and other provisions

(TDS Rates applicable for Financial Year 2022-23 / Assessment Year 2023-24 and other provisions)

👇🏻 👇🏻 👇🏻

https://bit.ly/34Aj7f0

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Thanks for reading

February 1, 2022 Updates

Aadhar authentication is not working for functionalities like Refund, Form 13, Registration and 26QB correction at TRACES website.

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If a taxpayer made mistake declaring the HSN/SAC of goods and services supplied. Consequences❓

Under GST law, most important elements is the classification of goods/services for the purpose of determination of rate of tax.

HSN/SAC codes Yes you are right 👍

1️⃣ Wrong classification of HSN/SAC leads to wrong rate of duty which further leads to wrong payment of taxes. 

2️⃣ GST charged at higher rates- This leads to loss of creditability, loss of customer base and incurring unavoidable loss on account of discounts given to customers. 

3️⃣ GST charged at lower rates- This leads to loss of non-recovery of tax, interest and penalties from customers. 

4️⃣ Department will ask for differential tax amount and buyer will not be there to reimburse the same. 

5️⃣ Wrong exemption claimed- This result in loss of non-availment of input tax credit. 

We have to pay the tax at a later date and credit will not be available due to Section 16 of CGST Act, 2017. 

6️⃣ Wrong classification of goods/ services leads to denial of export/import exemption under Foreign Trade Policy such as duty drawback, incentives etc.

Penalty of INR 50,000/- (INR 25,000/- each for CGST and SGST) can be levied for non-mentioning or mentioning wrong HSN/ SAC Code under Section 125 of the Central Goods and Services Tax Act, 2017.

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CBDT Vide Notification No. 11/2022, Dated 25th January 2022, has notified Annexure for Audit report to be filed by the Sovereign Wealth Fund claiming exemption under clause (23FE) of section 10 of the Income-tax Act, 1961.

Income Tax Assessing Officer  cannot make addition under Section 69A on a hypothetical basis without carrying out enquiry to find out more details held by Bombay High Court in the case of Principal Commissioner of Income-tax Vs. Nexus Builders and Developers (P.) Ltd.

Company to be treated as beneficial owner of  car purchased in the name of its Directors, eligible for Depreciation held by  THE ITAT AHMEDABAD in the case of Income-tax Officer Vs. Anunay Fab (P.) Ltd. 

 Government has detected evasion of GST, which also includes Central Excise and Service taxes prior to 2017, to the tune of Rs 93,375 crore. This was revealed in a RTI reply by the Directorate General of GST Intelligence’s (DGGI) various zonal units in major cities across India, including Delhi, Mumbai, Pune, Ahmedabad, Chandigarh and others.

Supreme Court appreciates ICAI for maintaining Examination Standards  “Look at how ICAI does it for Chartered Accountants. They control intake & also the quality.” Chides Bar Council for lowering the standards colleges & asks Bar Council“ it is high time you do an introspection. 

Competition Commission of India (CCI) is planning a revamp of the disclosure requirements when entities seek approval for merger deals to make the process less burdensome. At present, disclosures are made under Form-II if the market share of the post-merger entity exceeds 15%. 

ICAI issues 3 Guidance Notes on changes & disclosure requirements in Schedule III (Notification of 24.3.21) applicable wef FY 2021-22 onwards. 

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✅Union Budget 2022-23 to be presented on February 1, in Paperless form.

CBDT issued detailed rules on how taxes would be calculated. Maturity proceeds received under such high-value Ulips purchased after February 1, 2021, will not be tax-free under section 10(10D), as was the case earlier.

CBDT issues refunds of over Rs 1,62,448 crore to more than 1.79 crore taxpayers from 1st Apr,2021 to 24th Jan,2022," the Income Tax department tweeted.

Orissa High Court stays Income Tax section 148 notice issued after 31st March 2021. Case Law Details Case Name : Rashmi Motors Vs PCIT (Orissa High Court) Appeal Number : W.P.(C) No. 22802 of 2021 Date of Judgment/Order : 24/01/2022

The income-tax department has reportedly sent notices to a clutch of Mauritius-based private equity (PE) funds amid suspicions that unnamed persons call the shots in these funds, while the boards and managements merely serve as dummies. While tax officials are within their right to question such entities, let there be no fishing expeditions. 

GST new functionality of interest calculator in GSTR-3B is now live on the GST Portal. This functionality will facilitate & assist the taxpayers in doing self-assessment. This functionality will arrive at the system computed interest on the basis of the tax liability values declared by the taxpayers, along with the details about the period to which it pertains.

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Interest  on non-payment of GST may be recovered without Show cause notice.

1️⃣ The Punjab & Haryana High Court lifted a stay ordered earlier in the case of Bharti Airtel Ltd. (Now) to directly recover interest accrued to the tune of Rs 5.77 crore on late payment of tax due to a mismatch of credits.

2️⃣ Direct recovery means that the tax authorities are not required to send notices. The authorities may recover the amount by various means such as deducting the money owed to assesses, for instance, ITC or Sold the goods.

3️⃣ The department issued summons, the proceedings were challenges. Post replies ans submissions, the court has lifted the stay.

4️⃣ Section 79 empowers the officers to directly recovers the unpaid GST in the form of interest thru cited above.

This decision now allows the GST authorities to directly recover interest if tax is not paid on time due to mismatches in ITC

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Union Budget 2022-23 to be presented on 1st February, 2022 in Paperless form

👉To mark the final stage of Union Budget making process, sweets provided to core staff due for “lock-in” at their work workplace instead of Halwa ceremony due to ongoing Pandemic and health safety concerns.

👉Union Budget 2022-23 will be available on Mobile App after it is presented in Parliament “Union Budget Mobile App” to provide easy and quick access to Union Budget information to all stakeholder.

👉Mobile App is bilingual (English & Hindi) and is available on both Android and iOS platforms

👉Mobile App can be downloaded from the Union Budget Web Portal (www.indiabudget.gov.in). All Budget documents will also be available for download on Union Budget Web Portal

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Supreme Court of India decided that No restriction on parallel proceedings by different jurisdictional offices pertaining to different causes of action: Case Name : Euphoria Technologies Pvt. Ltd. Vs DGGI (Supreme Court of India)

Division Bench of Hon. Rajasthan High Court consisting of Chief Justice Akil kureshi and Justice Sameer Jain. in Sudesh Taneja vs. ITO DB W.P No.969/2022. Order dated 27.01.22 quashed the reassessment notices issued after 31.03.21.

Income Tax Section 14A disallowance needs to be re-worked based on investments which yielded tax free income. Case Name : Zuari Investments Ltd. Vs ITO (ITAT Delhi)

Unity Small Finance Bank, which has taken over the failed cooperative lender PMC Bank, on Thursday said all small depositors with under Rs 5 lakh of deposits — who form 96 per cent of the customer base — can take their entire money out now or keep it in the new bank and earn 7 per cent interest annually. 

ICAI has submitted a memorandum to a Parliamentary panel, raising concerns about certain provisions in the proposed bill to amend the law governing chartered accountants in the country. ICAI has submitted its views on the provisions, including the one pertaining to the constitution of disciplinary committee, to BJP member Jayant Sinha-led Parliamentary Standing Committee on Finance, which is looking into the bill.

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GST UPDATE

Alert on the GST portal

Where the liability declared in GSTR-3B varies significantly with Form GSTR-1

or

Where ITC taken in GSTR-3B varies significantly in comparison with auto populated GSTR-2B

indicating a contravention to the provisions in rules, *registration shall be suspended* in terms of Rule 21(2A) of CGST Rules 2017.

If one could remember, as per Notification 94/2020 dated 22nd December 2020, *a new sub-rule 2A has been inserted in Rule 21A of the Central Goods and Services Tax (CGST) Rules.

Any significant differences or anomalies observed between the GSTR-3B and the GSTR-1/2B could lead to suspension of GST registration.

Further, if these differences remain unexplained, the GSTIN could get cancelled.

The tolerence limit has been *kept at 10% in both cases by GSTN as per the alert message.

The taxpayer can check the comparison / variances post login by navigating through Services-->Returns--> Tax liabilities-->and ITC Comparison--> Select year (period).

This alert will definitely be helpful for the taxpayers to keep a tag on the variance/ anomalies and take corrective measures in time.

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Charitable Trust eligible for 30% Standard deduction against House Property under Income Tax Act. Case Name : Vishwa Kalyan Society Vs DCIT  (ITAT Ahmedabad) Appeal Number : ITA No. 449/AHD/2019 Date of Judgment/Order : 28/01/2022

Utility is available on GST Portal, now you can check Whether liability declared by a taxpayer in GSTR-1 is Paid through GSTR-3B or not and upto which extent. This feature will Definitely help in trapping bogus suppliers. But at the same time it is casting a responsibility that in case if tax is not deposited by the supplier and you are still dealing with such supplier risk of non eligibility of ITC on buyers.

Adlabs Entertainment has approached the Bombay High Court over extension of GST incentives for the period of lockdown due to Covid pandemic. The company in a writ petition filed with the court said that its water and theme parks remained shut during 2020 and 2021 due to forced lockdown by the government and this period should be excluded from the tax holiday and the exemption period should be extended by the number of lockdown days.

Application for GST refund cannot be rejected without recording any reasons. Case Name : Colgate Global Business Services Pvt. Ltd. Vs Union of India (Bombay High Court) Appeal Number : Writ Petition No. 802 of 2021 Date of Judgment/Order : 25/01/2022

Govt has notified the second phase of the Scheme on Enhancement of Competitiveness in the Indian Capital Goods Sector for providing assistance for common technology development and services infrastructure, with a financial outlay of Rs 1,207 crore. The outlay includes Budgetary support of Rs 975 crore and industry contribution of Rs 232 crore. The scheme was notified on January 25. 

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CBDT extends deadline for updating UDINs for all the Income Tax Forms upto 30th April 2022 at Income Tax Portal

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GST: Recovery proceeding justified for differences in outward supply in GSTR-1 vs. GSTR 3B⁉️

1️⃣ GSTN has started showing warning that registration can be suspended if there is a deviation of > 10% between liabilities declared in GSTR-1 and declared in GSTR-3B, or ITC available as per GSTR-2B and claimed in GSTR-3B.

2️⃣ Rule 21A (2A) permits suspension of registration in case there are significant differences or anomalies but the limit of 10% mentioned appears to be arbitrary.

3️⃣ Section 16 mandates that the ITC can be claimed subject to the tax charged in respect of such supply has been actually paid to the Government.

4️⃣ Sec 75(12) amended "self-assessed tax” shall include the tax payable in respect of outward supplies, the details of which have been furnished under section 37 but not included in the return furnished under section 39.

5️⃣ CBIC issues Guidelines for Recovery proceedings under CGST Act.

There may be genuine reasons for the differences. The proper officer may send the communication to taxpayers to pay the amount within a reasonable time. If the taxpayer is able to justify the reasons then no recovery proceedings initiate.

6️⃣ GSTN now provides the details of tax paid by any taxpayer based on the liability declared in GSTR-1/IFF and tax paid in GSTR-3B.

7️⃣ Calculation methodology: https://services.gst.gov.in/pages/services/liabpaidperFormula/LiablityPaidPercentageFormula.html

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